Gas prices roundup
At a hearing of the House Energy & Commerce Subcommittee on Energy & Power, experts and small business owners cited excessive government regulations and Obama administration roadblocks to American energy production as principle factors behind their struggle to cope with rising energy costs. The hearing was part of the coordinated Republican effort to hold the Obama administration to account for skyrocketing gas prices. Here are some of the highlights:
- Despite ‘All-of-the-Above’ Rhetoric, Obama Administration Policies “Hinder” More American Energy Production “At Every Turn.” Jack Gerard, President and CEO of the American Petroleum Institute, said when it comes to President Obama’s ‘all-of-the-above’ energy policy, “the administration is saying one thing, doing another” with policies “that hinder oil and natural gas at nearly every turn.” As Gerard explained, “The administration says it is for more oil and gas, but rejects the Keystone XL pipeline. It says it is boosting domestic production onshore, but new leasing on federal lands is down 44 percent, and the number of new wells drilled is down 39 percent. It says it is opening offshore areas but the latest plan keeps 87 percent of these areas off limits. It says oil and gas activity in the Gulf of Mexico is back to normal, but the latest forecast says production this year will be down nearly 21 percent from 2010.” Chris Milburn, professional truck driver and owner of CarbM Trucking, said he finds “it difficult to understand why regulatory and other roadblocks remain to accessing these important American energy resources,” adding that the “OOIDA [Owner-Operator Independent Drivers Association] supports actions taken by the House” to expand American energy production. “This legislation represents a common-sense effort to knock down regulatory barriers preventing environmentally sound energy production in places like the Gulf of Mexico and the Mountain West,” Milburn said.
- “Barrage Of Unnecessary and Costly Regulation” Driving Up Gas Prices and Costing Jobs. According to Chris Milburn, “small business trucking has been assaulted by a barrage of unnecessary and costly regulation[s]” which “not only rob small business truckers of the ability to maintain and grow their business, but also decrease the incomes of hundreds of thousands of families around the country.” Charles Drevna, President of the American Fuel & Petrochemical Manufacturers, cited a Department of Energy report issued last year that found excessive regulations were a “significant factor” in the “closure of 66 petroleum refineries in the United States in the past 20 years.” As Drevna put it, “the size, scope, and cumulative burden of current and impending regulatory activity is creating both significant regulatory uncertainty and a slew of conflicting regulations that will impose significant burdens on domestic fuel manufacturers and eventually consumers.”
- Approving Keystone XL Pipeline “Would Help Remove the Uncertainty About Future Supplies” Affecting Energy Prices. Charles Drevna said delays in the Obama administration’s energy permitting process are “adding enormously” to the cost of new projects, making it less likely that some may be built.” Drevna referred specifically to the Keystone XL pipeline as “the most recent victim of regulatory delay” noting that it “has been studied by federal reviewers for more than three years” and is still “being required by President Obama to undergo yet further study.” Drevna said “getting more U.S. and Canadian oil – along with oil from North Dakota and Montana – delivered to Gulf Coast refineries via Keystone XL … would help remove the uncertainty about future supplies that is a factor in the recent rise of oil prices.” John Eichberger, Vice President of Government Relations for the National Association of Convenience Stores (NACS), agreed, saying “improving access to Canadian crude oil products would help supplement overall supplies” and help address gas price spikes.
- Democrats’ Call to Release Energy from the Strategic Petroleum Reserve “Would Increase Market Uncertainty and Price Volatility.” Robert McNally, President of the Rapidan Group and an energy analyst with 21 years of experience, warned that “if the US tries to use strategic stocks to keep gasoline prices stable,” as Democrats have called for, “it is likely to end up with neither strategic stocks nor gasoline price stability.” In fact, McNally said “frequent, capricious frittering away of strategic stocks in a futile attempt to influence global oil prices would increase market uncertainty and price volatility.”
Under the American Energy Initiative, House Republicans have passed several bills that would eliminate the Obama administration’s barriers to American energy production, move the Keystone pipeline forward, and cut through the red tape that is driving up gas prices and other energy costs for American families and small businesses. At a press conference yesterday, Speaker Boehner reiterated his hope that President Obama would follow through on positive discussions with Republican leaders and call on Senate Democrats to pass the nearly 30 bipartisan energy and jobs bills they continue stalling. Learn more about the American Energy Initiative at facebook.com/americanenergy, and follow the progress of House-passed legislation to address rising gas prices and create a better environment for private-sector job growth at http://jobs.gop.gov.
President Obama has a lot to answer for when he faces the White House press corps today, starting with skyrocketing gas prices. Actually, it was at a press conference nearly a year ago that the president said his administration was doing “everything we can” to address the pain at the pump. Things have only gotten worse since, and now the president finds himself firmly on the defensive in the face of a coordinated Republican offensive:
“Republicans have seized on rising gas prices as a political weapon against President Obama. … The GOP messaging plan has been to paint Obama on the wrong side of energy independence. From speeches to Capitol stakeouts to op-eds, top Republicans have been hammering this notion on a daily basis over the last few weeks, blaming the president for rising gas prices and citing his rejection of the Keystone pipeline and various other House GOP deregulation bills as evidence that he opposes domestic energy production. … [President Obama] has adopted the ‘all of the above’ energy rhetoric that Republicans have used for years.” (Talking Points Memo, 3/5/12)
It’s no surprise that of its five questions for President Obama, POLITICO’s first is “What are you doing about the price of gas?” Here are five more on the topic:
- Last spring, you described the nation’s energy policy as a “hodgepodge.” Do you accept any responsibility for gas prices more than doubling on your watch? Could you have done anything differently, whether it’s your rejection of the Keystone XL pipeline or pledging support for offshore energy production in Brazil while blocking it here in the United States?
- After your meeting last week, Republican leaders saw new hope of common ground on energy. The House has passed several bipartisan bills that act on the ‘all-of-the-above’ energy policy you say you now support. Can you assure the American people that the Senate will begin acting on some of the bipartisan, House-passed energy bills?
- There have already been indications that your rejection of the Keystone XL pipeline will contribute to higher gas prices. Last week, President Clinton said “we should embrace” the project. Do you regret your decision to reject the Keystone XL pipeline and will you reconsider it? Do you agree with your spokesman that pleas to approve the pipeline are “insulting”?
- Last week, your Energy Secretary told members of Congress that lowering gas prices is not your administration’s goal – the same secretary who has overseen the Solyndra debacle. Do you agree with Secretary Chu that lowering gas prices is not your administration’s goal?
- Dozens of Congressional Democrats have called on you to again tap the Strategic Petroleum Reserve (SPR) to address high gas prices. Speaker Boehner indicated that in your meeting last week you were not inclined to do so. Will you tap the Strategic Petroleum Reserve, and if not, what makes this year different from last year?
This week, the House will pass another ‘all-of-the-above’ energy jobs bill, while committees continue to examine the Obama Administration policies that have led to higher prices and fewer jobs. Learn more by visiting the American Energy Initiative on Facebook or going to jobs.GOP.gov.
With gas prices rising higher and faster than ever, Democrats are firmly on the defensive, trying to deflect blame by calling for action on alleged energy speculation. It’s another hollow talking point, given that government investigations have consistently shown that the “speculation” scapegoat is not what’s driving up pain at the pump. Here’s what several independent investigations have already concluded about the cause of rising gas prices:
- Last Year, the Federal Trade Commission’s [FTC] Bureau of Economics Determined that “Worldwide Crude Oil Prices Continue to Be the Main Driver of What Americans Pay at the Pump.” (Gasoline Price Changes and the Petroleum Industry: An Update, September 2011)
- A 2008 Preliminary Analysis by the Commodity Futures Trading Commission [CFTC] Found that High Gas Prices Between 2003 and 2007 Were “Largely Due to Fundamental Supply and Demand Factors.” “The Task Force’s preliminary assessment is that current oil prices and the increase in oil prices between January 2003 and June 2008 are largely due to fundamental supply and demand factors. … [T]he Task Force’s preliminary analysis to date does not support the proposition that speculative activity has systematically driven changes in oil.” (Interim Report on Crude Oil, July 2008)
- A 2005 Federal Trade Commission Report Concluded that “The Vast Majority of the FTC’s Investigations” Have Found “Market Factors to Be the Primary Drivers of Both Price Increases and Price Spikes.” (Gasoline Prices Changes: The Dynamic of Supply, Demand and Competition, 7/5/05)
Democrats’ finger-pointing is nothing new. Last year, following President Obama’s announcement that he was forming a task force to investigate gas prices, a CNN report said the president was taking a page from the “rhetorical playbook politicians have used for years when gas prices go up,” calling for investigations that “don’t lead anywhere and…politicians know it.” “That’s just ‘I want to pretend I’m doing something even though I’m doing nothing,’” said Amy Myers Jaffe, director of the Energy Forum at the Baker Institute for Public Policy at Rice University in Houston.
Sure enough, in the year since the president’s announcement, the task force “met only a handful of times and has never reported to the public.”
If Democrats are really searching for the culprit behind skyrocketing gas prices, they need look no further than the failed Obama administration policies that have blocked more American energy production and stopped more than 800,000 barrels of oil a day from flowing to U.S refineries via the Keystone XL pipeline – not to mention the onslaught of excessive regulations that are driving up costs and destroying jobs by putting energy producers out of business.
According to a recent CBS News survey, “sixty-seven percent of Americans say high gas prices have caused a financial hardship in their households.” Economists warn that “high gas prices could be the tipping point that brings on a new economic downturn.” Yet, with no relief in sight, Democrats are offering nothing more than smoke-and-mirrors political gimmicks that will do nothing to bring down prices or protect American jobs.
Republicans, on the other hand, have passed several American Energy Initiative bills to boost energy production, address rising gas prices and create jobs. Senate Democrats are sitting on these, and nearly 30 other bipartisan, House-passed jobs bills they refuse to bring to a vote. Speaker Boehner wrote to President Obama last week urging him to back Republicans’ push for an all-of-the-above energy policy that he claims to support. With gas prices heading toward $4 per gallon, it’s time for President Obama to urge Senate Democrats to pass these critical American Energy Initiative bills so they can be enacted into law without further delay. Learn more: facebook.com/americanenergy.